Blackstone guilty of insider dealing

A FORMER porn actor was left with a £20,000 bill today after being found guilty of making a fraction of that amount from insider trading.

Timothy Blackstone, who became a public relations consultant after years of performing in front of blue movie cameras, bought stock in a company which had just briefed him on its takeover plans.

By the time the father of three and brother of Labour peer Baroness Blackstone sold the 150,000 shares 24 hours later, they had jumped 25% in value netting him a profit of £3,181.25, London's Blackfriars Crown Court heard.

The one-time actor and journalist said he never realised what he had been told amounted to 'price sensitive' information. But he showed no reaction as the jury of three women and eight men convicted him of two counts of insider dealing.

The first concerned the purchase of stock in Edinburgh based Murray Financial Corporation (MFC) on August 26, 1999, the day after Blackstone joined Margaret Thatcher's former press secretary Sir Bernard Ingham as one of the firm's advisers. The second offence involved selling the shares the following lunchtime.

The £70,000 a year consultant - whose exploits in the porn industry during the 1970s and 1980s included appearances in such productions as Emmanuelle in Soho, Under The Bed Tonight, and I'm Not Feeling Myself Tonight - stood with his hands clasped in front of him as judge Christopher Hordern said he was 'very sorry to find someone in your position and of your age' in the dock.

The judge went on: 'It is clear to me that this court must send a signal which deters others from taking the chance which you quite clearly did with your eyes open.'

Making it clear he was 'taking no notice' of Blackstone's previous convictions, involving one of assault and several for shoplifting, the judge felt an 'entirely nominal fine' of £1,000 would be appropriate in the circumstances.

But in addition Blackstone would have to contribute £16,000 towards prosecution costs, and hand over his £3,000-plus profit from his insider trading.

If the latter was not paid within six months, Blackstone faced three months in prison, the judge said.

The court that heard MFC was set up with the express purpose of buying building societies and other financial institutions which faced demutualisation.

However, after one of its proposed take-overs was 'killed off' by publicity about their intentions, the company started hunting for new PR advisors.

Blackstone, 56, of Merrick Square, Southwark, south-east London, was an old friend of the company's boss, Kenneth Murray, and offered his services when he heard of the firm's need.

Philip Katz QC, prosecuting, said the defendant and his firm, Blackstone Business Communications, were duly appointed by the MFC board on August 25, 1999.

Immediately afterwards the consultant was briefed about his new client's planned bid for the Leek United Building Society in Staffordshire.

'The prosecution's case is this - that Mr Blackstone, by virtue of his appointment as the public relations advisor, had access to what the law calls inside information,' said Mr Katz.

'The inside information in this case is the proposed offer... there is no bones about it, that information was not in the public domain. After it had been, it is likely to have had a significant effect on the price of the shares of MFC,' said counsel.

He told the jury that the day after his appointment Blackstone bought the 150,000 MFC shares for just over £13,300. Just over 24 hours later, by which time they had risen by 2.25p to 11p, he told his stockbroker to sell.

The court heard that months later, as the Department of Trade and Industry probed his dealings, Blackstone phoned Mr Murray and 'effectively admitted he had done something very stupid'.

For his part Blackstone insisted he had done nothing wrong 'either morally or criminally'. What had occurred was nothing more than a 'misjudgment'.

He told the jury he had considered buying MFC shares for some days before he finally gave his stockbroker the go-ahead, but decided in the event to wait until he was 'on board' and his appointment had been confirmed.

As far as he was concerned he considered the stock such a good 'long-term' investment he even bought some of the company's shares for his elderly mother. With the 'benefit of hindsight' he now wished he had never gone ahead with the deal.

He added that while it never occurred to him he might be privy to 'inside information', he sold the stock the following day after becoming 'very concerned' over a steep rise in its value.